Correlation Between Nordic Semiconductor and St Galler
Can any of the company-specific risk be diversified away by investing in both Nordic Semiconductor and St Galler at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Nordic Semiconductor and St Galler into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nordic Semiconductor ASA and St Galler Kantonalbank, you can compare the effects of market volatilities on Nordic Semiconductor and St Galler and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Nordic Semiconductor with a short position of St Galler. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Semiconductor and St Galler.
Diversification Opportunities for Nordic Semiconductor and St Galler
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nordic and 0QQZ is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Semiconductor ASA and St Galler Kantonalbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on St Galler Kantonalbank and Nordic Semiconductor is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Nordic Semiconductor ASA are associated (or correlated) with St Galler. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of St Galler Kantonalbank has no effect on the direction of Nordic Semiconductor i.e., Nordic Semiconductor and St Galler go up and down completely randomly.
Pair Corralation between Nordic Semiconductor and St Galler
Assuming the 90 days trading horizon Nordic Semiconductor ASA is expected to under-perform the St Galler. In addition to that, Nordic Semiconductor is 4.62 times more volatile than St Galler Kantonalbank. It trades about -0.01 of its total potential returns per unit of risk. St Galler Kantonalbank is currently generating about -0.02 per unit of volatility. If you would invest 48,878 in St Galler Kantonalbank on October 11, 2024 and sell it today you would lose (3,528) from holding St Galler Kantonalbank or give up 7.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic Semiconductor ASA vs. St Galler Kantonalbank
Performance |
| Timeline |
| Nordic Semiconductor ASA |
| St Galler Kantonalbank |
Nordic Semiconductor and St Galler Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Semiconductor and St Galler
The main advantage of trading using opposite Nordic Semiconductor and St Galler positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Semiconductor position performs unexpectedly, St Galler can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in St Galler will offset losses from the drop in St Galler's long position.| Nordic Semiconductor vs. Cizzle Biotechnology Holdings | Nordic Semiconductor vs. Edita Food Industries | Nordic Semiconductor vs. Spotify Technology SA | Nordic Semiconductor vs. Alfa Financial Software |
| St Galler vs. EVS Broadcast Equipment | St Galler vs. Bankers Investment Trust | St Galler vs. Amedeo Air Four | St Galler vs. Beeks Trading |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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